O.C. bankruptcies decline year-over-year

In October, 1,246 individuals and businesses filed for bankruptcy in Orange County, 13.5 percent lower than a year earlier, but 16.1 percent more than in September, reported the federal bankruptcy court.

Bankruptcy filings also increased for California's central district of which Orange County is a part. The district encompasses, Los Angeles, Riverside, San Bernardino and Santa Barbara counties.

The year-over-year filings continue to decline:

 Los Angeles County, 3,777 cases, -10.1 percent from October 2011

 Riverside-San Bernardino counties, 2,378 cases, -19.9 percent

 Central District, 8,815 cases, -13.9 percent

Bad times in the economy make for fewer bankruptcy filings a few years later, which is what we have been seeing lately," said Jean Braucher, University of Arizona law professor and Credit Slips blogger.

But the decline in filings does not necessarily mean the economy is improving, she added. "What drives bankruptcy filings is debt. Decreases in debt are followed a few years later by decreases in bankruptcy, and increases in debt are followed by increases in bankruptcy. The Great Recession that started in 2007 resulted in a great decline in household debt due to a combination of reduced access to credit and consumers voluntarily cutting back on debt-driven spending because of a lack of consumer confidence."